Dundee nightclub boss Tony Cochrane has backed a legal bid against the Scottish Government’s coronavirus restrictions on hospitality.
Announcing the legal action, the Nightime Industries Association [NTIA] said the hospitality sector had been “driven to the edge of insolvency by the severe restrictions” in place during the pandemic.
The group criticised the support put in place by the Scottish Government for business as “wholly inadequate to compensate for operating losses”.
They said a majority of businesses have now incurred “unsustainable debt” as a result of this, with up to 39,000 jobs at risk as a result.
“Even worse all strategic framework funding has now ended while there is no end date for the restrictions that make these businesses commercially unviable,” they said.
Business support grants
The Scottish Government’s Strategic Business Framework Fund was extended in January to offer one-off grants of up to £25,000 to hospitality businesses.
Those closed during the second coronavirus lockdown also received a four-weekly payment of up to £3,000, depending on the size of the business.
Speaking in January, finance secretary Kate Forbes said: “Since the start of the pandemic Scottish Government support for business and the economy has reached almost £3 billion – more than a third of our total coronavirus (COVID-19) funding, demonstrating our commitment to provide as much help as we possibly can to our businesses.”
The hospitality sector was allowed to reopen for the first time in months on April 26, but alcohol can only be served outdoors and social distancing rules still apply.
Restaurants, cafés, pubs, and bars can open indoors for the consumption of food and non-alcoholic drinks until 8pm only.
‘Thousands of businesses commercially unviable’
The NTIA claimed the restrictions on opening, capacity, activities and operating hours make thousands of businesses “commercially unviable”.
They added: “Hospitality businesses typically operate on wafer thin profit margins, as little as 5 per cent, while these restrictions can result in businesses suffering such immense declines in income that bankruptcy will be the inevitable result if they continue for much longer.
“Social distancing is toxic for businesses across numerous sectors of the economy, from restaurants, pubs and bars, wedding suppliers, music venues, nightclubs, coach tours, travel, and tourism, and many more.
“We accept that restrictions were initially necessary in the interests of public health, and indeed we not only fully supported previous measures taken, but also actively promoted the government’s public health messages via social media channels and to our customer base.
‘No longer justifiable’
“However, thanks to the heroic efforts of our NHS workers, vaccine researchers, and scientists, and the immensely successful roll-out of the vaccine, Covid-19 no longer presents the threat to public health that it did even a few short months ago.”
The NTIA have launched a judicial review of the ongoing restrictions which they say are “no longer justifiable” and are in breach of the Human Rights Act.
The group will be represented by Roddy Dunlop QC, Dean of the Faculty of Advocates.
Tony Cochrane, owner of Club Tropicana, Fat Sams Live and Aura Dundee said: “Scottish Government’s failure to give the Scottish Nightclub Sector any dates on potential reopening, just a tier system that leaves us the only industry to have forced closure even at level 0 and no clarity on how this system progresses below level 0.
“Every other sector has a timetable to recovery, we have been given nothing. All financial assistance has stopped and no further offer of funding with months of costs ahead and no income leaving us on the brink of collapse.
“This frustration of no route map, failure to have constructive dialogue, the threat to our 350 staff’s livelihoods, continued closure, and lack of action to give financial support has led us to having no alternative but to challenge Scottish Government through the legal system.”
SNP Minister for Business Jamie Hepburn said: “We know that nightclubs have been particularly badly hit by this pandemic. That is why the Scottish Government extended rates relief for a further 12 months and made available grants of up to £50,000 for the sector, as well as £19,500 restart grants – on top of any UK government support.
“We have also supported freelance artists and performers with grant funds that were unavailable elsewhere in the UK.
“We don’t want any business to remain closed for a day longer than is necessary but public health is paramount and we must move carefully to ensure continued suppression of the virus.”